The globalized economy is a colossal Ponzi Scheme in which the vast majority survive on the bread crumbs falling off the table. The possibility of 7 billion people achieving a consumption-oriented lifestyle is zero, so the World Bank conveniently set the poverty line at $1.25/day to legalize global slavery. As long as someone else's children are doing the suffering, it's "all good". Post-2008, this illusion was extended merely by plundering all future generations.

Friday, February 10, 2017

An Historically Leveraged Financial Collapse

The drawback to being a dedicated denialist, is that you never know when you're about to get monkey hammered into fucking oblivion...Exactly one week ago, Trump repealed Dodd-Frank, so gamblers have had this entire week to double down on their collapsing reflation fantasy...This week, U.S. crude inventories had their second largest increase in history. So historically leveraged crude futures were bid on the news. Whereas Energy stocks were not quite as sanguine.

Any questions?

The historically leveraged short bond trade took a break from collapsing, shown here with Goldman Sachs:

The massively leveraged Russell 2000 small cap (aka. banks) had a mild bounce this week, while still underperforming the other major indices...Russell/Dow ratio

The bankrupt Marine shipping stocks had a good week, even as the Baltic Dry Index collapsed all week...

Despite Trump's best efforts to implode retail via his border adjustment tax scheme lowering corporate taxes at the expense of the middle class, retail bounced this weekLed by none other than Sears. What else?Up 38% at the open today. Can you see it?

Speaking of retail, consumption sentimentality finally imploded this week (red line), even as retail bounced off its trendline...